File photo by Josh Reynolds / Associated PressNStar Chairman, President and CEO Thomas J. May, left, and Northeast Utilities Chairman, President and CEO , Charles W. Shivery, right, speak at a news conference in Boston in 2010, the day it was announced that Northeast Utilities plans to buy Nstar for $4.17 billion, forming the biggest New England utility company with 3.5 million electric and gas customers in three states.

The Public Utilities Regulatory Authority ruled that the deal to buy NStar may not go forward without its approval.

Regulators said they acted because NStar shareholders will own about 44 percent of the Hartford-based Northeast Utilities – large enough to require regulators to become involved.

Connecticut also said the conditions of merger approval in Massachusetts may affect future policy and resources related to Northeast Utilities subsidiaries in Connecticut. Massachusetts regulators also are reviewing the deal.

Northeast Utilities spokesman Al Lara said the utility is disappointed with the decision, but will soon submit the merger application.

“We believe their initial decision was correct,” he said. “However we do intend to comply with their request and submit the merger application as soon as we are able to.”

Elin Swanson Katz, Connecticut’s consumer counsel, said she is delighted with the decision.

“We appreciate the thoughtful analysis that (regulators) did,” she said.

The Office of Consumer Counsel had sued in state Superior Court to force regulators to reverse their decision. Katz said withdrawing the lawsuit is “certainly on the table,” but a final decision will not be made until she is certain Northeast Utilities will not appeal regulators’ decision.

The consumer advocate said her objection from the start was the potential change in the control of Northeast Utilities after the deal.

“Ultimately, they’re creating a new company and ultimately, that’s what the authority found,” Katz said.

Katz and Connecticut Attorney General George Jepsen also demanded state oversight into the deal following the rare October storm that left hundreds of thousands of customers of Connecticut Light & Power, a subsidiary of Northeast Utilities, without electricity for as many as 11 days. The utility faced criticism from nearly all quarters for its response to the storm that downed trees, branches and power lines throughout Connecticut.

The deal faces an April 16 deadline when it terminates. Lara said Connecticut regulators emphasized the timeline for the merger “and that they would try to work within it.”

The deadline is less than 13 weeks away, and it’s been 15 months since Northeast Utilities and NStar announced the deal in October 2010.

Connecticut regulators said in June their authority to intervene was not necessary because the state would continue to regulate Yankee Gas and CL&P if the deal is ultimately approved by Massachusetts officials.

If approved, the deal would create the biggest New England utility company, serving 3.5 million electric and gas customers in Connecticut, Massachusetts and New Hampshire.